U.S.-EU Trade Deal Is Good for Jobs and Prosperity

By Bob Corker -
Mar 25, 2013

Two years ago, Volkswagen AG (VOW) opened
a $1 billion manufacturing facility in Chattanooga, Tennessee,
that employs 3,300 Americans and makes 150,000 cars a year for
the U.S. market and for export to Canada, Mexico and South
Korea.

This investment has been transformative, creating jobs and
growth not only in Tennessee but also throughout the region.
It’s an experience we can repeat throughout the country if we
tear down obstacles to foreign investment and trade.

Last week, President Barack Obamaformally told Congress of
his intention to create the Trans-Atlantic Trade and Investment
Partnership with Europe. Completing this historic agreement will
strengthen America’s future competitiveness and prosperity.

The U.S. and the 27 nations of the European Union form the
world’s largest trading area. Our combined population of 800
million generates almost half of the world’s gross domestic
product. As the world’s two biggest markets, the U.S. and Europe
account for more than 40 percent of world trade.

In addition, the U.S. and Europe are heavily invested in
each other’s economies. Our manufacturing processes are already
highly integrated. In 2011, U.S. investors earned more than $250
billion in income on European assets. European investments like
Volkswagen’s in Tennessee have created millions of jobs in the
U.S.

Eliminating Tariffs

In spite of these deep trade and investment ties, we could
be doing better. An automobile built at Volkswagen’s Chattanooga
plant faces a 10 percent import duty if exported to Europe. The
trade agreement would eliminate these tariffs, reducing costs
for the consumer, encouraging further investment in the U.S. and
spurring new trade between our economies. Greater transparency
and regulatory coherence under the agreement would deliver
further benefits by cutting our costs and making our businesses
more competitive.

Today the U.S. is looking forward to an abundance of cheap
domestic energy, especially natural gas, which is already
powering a manufacturing renaissance. This will make the U.S. an
even more attractive platform for exports to the EU and beyond,
drawing in additional European investment. The trade deal will
help us make the most of this remarkable opportunity.

A successful trans-Atlantic trade and investment deal would
provide advantages beyond our borders as well. Closer
cooperation between the U.S. and EU will probably lead to common
approaches to resolving trade issues with other countries and
strengthen our hand at the World Trade Organization. Working
together, the U.S. and Europe can lead the world in liberalizing
trade worldwide -- creating new opportunities for our
businesses, more growth and more jobs.

The benefits of an agreement are overwhelming, but there
are obstacles to overcome. The U.S. and EU have longstanding,
unresolved differences in sectors such as agriculture. We must
also be careful that regulatory coherence promotes efficiency
rather than an expanded regulatory state. But these challenges
shouldn’t discourage us from pursuing a comprehensive and
ambitious agreement. We have a chance to settle our differences,
and we shouldn’t let it go by.

Under our Constitution, Congress is tasked “to regulate
Commerce with foreign Nations,” and a trade agreement reached
with Europe needs approval by Congress and the European
Parliament. It’s essential that we have a healthy dialogue
between the executive and legislative branches to build support
for the agreement before anything is final.

Cooperation Needed

From the beginning of his administration, President Obama
has engaged in negotiations with our trading partners without
specific authorization from Congress. The president should work
with Congress to enact trade promotion authority this year. That
will only strengthen our hand in these talks. The American
people expect Congress and the president to work together to
ensure that our trade priorities serve the goals of economic
growth and jobs.

Much has been made of President Obama’s “pivot to Asia.”
We’re turning our focus to Asia for important strategic reasons,
and I’m confident the president can look toward Europe with an
equal sense of purpose.

I intend to be a very active advocate in the Senate for a
U.S.-EU free-trade agreement, and look forward to working with
the president and my colleagues to ensure these negotiations are
successful.

(Bob Corker is a Republican U.S. senator from Tennessee and
the ranking member of the Senate Foreign Relations Committee. The
opinions expressed are his own.)